Friday, March 04, 2005

Belt Tightening and IOU’s

Cambio Healthcare Solutions wants to look good to the politicians, lower costs at any price. They have given up on revenue enhancement and fixing the broken billing department. They are focusing instead on more cost cutting: squeezing budgets, running off more staff, and not paying bills. Who knew you could run a hospital on IOU’s?

Cambio’s brain trust is going department-by-department chopping fat and waste. Physical therapy lost its wheel chair budget, respiratory therapy its equipment budget (those ventilators are a real excess). We fully expect that they’ll just fire all the discharge planners and replace them with new technology: the hospital ejecto-bed (which will propel patients off the roof and back into the streets of Oakland).

Actually, the consultant’s high-risk management schemes have begun melting down. Cambio Healthcare Solutions thinks unions are icky, so they have replaced many permanent staff with travelers and temps. They outsourced about half the nurses in the emergency department and the critical care areas.

Whenever a highly qualified specialist nurse tries to get hired on at the medical center, their resume gets lost. “You can teach the traveler from Virginia how to give chemotherapy. She has ten years of experience in labor and delivery it can’t be that different.”

So aside from frightening patient care scenarios this passion for outsourcing has now created a financial crisis. You see temp agencies are ruthless negotiators and when they supply a huge percentage of your staff, they can pretty much name their price. That’s just what the agency that supplies one third of the medical center’s respiratory therapists did. The raised the hourly rate from $ 38 to $54 dollars an hour. Oops, there goes your cost savings.

Cambio showed them, they cancelled the contract. Starting Saturday they’re gone, no more travelers. So now they will be paying the regular staff tons of overtime. Actually the department maybe able to run with less respiratory therapists if the ventilators get repossessed, that will really cut the work down.

Any day now, the nursing outsourcers (who provide half of the critical care nurses) will decide to gouge the medical center and raise their rates; this will catapult the medical center back into big debt. Cambio’s betting they can ride on temps, IOUs and service cuts until their contract is up. They run a lean mean healthcare machine and they’re running the medical center right into the ground.